Consolidated Suits Challenging the Reverse Merger Will Proceed in Federal Court. . . .

Last night, Judge Cavanaugh -- applying the Supreme Court's Colorado River factors in much the manner I suggested he would -- held that the federal, not state, courts should hear the challenges to the proposed Sch-Merck reverse merger (thus giving the vast bulk of the plaintiffs the benefit of their preferred forum for jurisdiction purposes, while not requiring Schering-Plough to defend itself in multiple fora, related to this matter):

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

IN RE SCHERING-PLOUGH/
MERCK MERGER LITIG.

THIS DOCUMENT RELATES TO:
ALL CASES

Hon. Dennis M. Cavanaugh

ORDER
Civil Action No.
09-CV-1099 (DMC)

. . . .This matter coming before the Court upon motions by Defendant Schering-Plough Corp. and Plaintiffs-Intervenors David Plotkin, Mitzi Zank, Steven Rosenberg, and Michael Gardone (the "Plotkin Plaintiffs") relating to whether this Court should exercise jurisdiction in this matter or abstain in deference to the state court; and the Court having reviewed all submissions;

WHEREFORE federal abstention law imposes a "virtually unflagging obligation" on district courts to exercise the jurisdiction given them, see Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 817 (1976);

WHEREFORE district courts may nonetheless abstain from exercising jurisdiction under "exceptional circumstances," including where necessary out of respect for “considerations of wise judicial administration,” see id. at 814–17;

WHEREFORE courts determining whether "exceptional circumstances" exist should consider: (1) which court first assumed jurisdiction over the property involved, if any; (2) the relative convenience of the fora; (3) the desirability of avoiding piecemeal litigation; (4) the order in which jurisdiction was obtained; (5) whether federal or state law applies; and (6) whether the state court will adequately protect the federal plaintiff’s interests, see BIL Mgmt. Corp. v. New Jersey Econ. Dev. Auth., 310 Fed. App’x 490, 492 (3d Cir. 2008);

WHEREFORE it appears that federal jurisdiction exists in this case under 28 U.S.C. § 1332(a);

WHEREFORE the Court has discussed this matter with Judge Malone of the New Jersey Superior Court, Union County, and determined that the exercise of federal jurisdiction is appropriate in this case;

IT IS on this 1st day of June, 2009;

ORDERED that the Court will retain jurisdiction over this matter;

ORDERED that the Plotkin Plaintiffs’ motion to stay or dismiss the federal action is denied; and it is

ORDERED that, based upon the Court’s understanding that Judge Malone will issue an order staying or dismissing the related state court actions in an order on this day, the Defendant’s motion to proceed in one forum, and to dismiss or stay the litigation in the other forum, is granted.

/s/Dennis M. Cavanaugh

Dennis M. Cavanaugh, U.S.D.J.

Original: Clerk
cc: All Counsel of Record. . . .

So, all of the above banks will have to defend in a federal forum -- and, rather selfishly, it will make it much easier to cover each development, in almost real-time, here -- as the federal courts are far more "wired-accessible" (laden with electronic filings, in full-text) than the state ones, at least in New Jersey.